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Brain drain in the Philippines

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  • 1. Name: Geun Ho LeeMr. SheridanTSEA (1)May 12, 2011 Tolerating Brain Drain in the Philippines: Should the Philippines? Midwife Chae Reviso came back in the Philippines, her motherland, after eight yearsworking tax-free and living rent-free in Saudi Arabia to live again with her husband.However, barely a year later, Mrs. Reviso is preparing to leave again as she finds too fewwork opportunities in her homeland. Although she came back because she felt that she owedher husband some time, she is not satisfied with the situation in her homeland as she claimsin frustration, “I cannot afford to build a house on my salary in the Philippines” (Macaraig). For decades, the problem of brain drain in the Philippines has been an on-going issue.Recently, it has gotten worse as the number of the top skilled and educated workers leavingthe country continues to rise (Alburo and Danilo). The increasing number of overseasFilipino workers (OFWs) benefits the Philippines economically as the remittances sent backhome encourage others to get educated and work abroad (Hennessey). Thus, some are contentwith the government’s inactive stance on the brain drain. Despite the economic and socialbenefits the Philippines gains from the export of its citizens, the Filipino government shouldtake more aggressive actions to minimize this, because the net effect of the brain drain isnegative, causing economic troubles, impeding the development of the nation, and causingsocial problems. The economic problems in the Philippines caused by brain drain are much greaterthan the benefits. One main economic problem experienced is that the local Filipinopopulation becomes too dependent on the remittances sent back home by the OFWs.According to the World Bank’s 2005 Global Economic Prospects report, there is evidence to
  • 2. suggest that remittances retard local development by crowding out entrepreneurial initiative(Hennessey). This is a serious problem since the economy cannot grow or continue to existwithout entrepreneurs starting up and venturing businesses. Simply put, lack of entrepreneursputs a halt on an economy. Also, exporting skilled and educated workers makes the countryto be dependent on the economies of importing nations. For instance, the OFWs in developednations have been significantly affected by the collapse of technology stocks as thetechnology firms closed down and thereby open job positions for technology-specializedworkers intensely decreased. Thus, the thousands of technology-specialized OFWs are nolonger in demand (Alburo and Danilo). A problem arises from this because these newlyunemployed workers come back to their homeland and increase the unemployment rate athome. Again this problem caused by brain drain works against the economic growth of thePhilippines. Moreover, the most significant problem due to brain drain is that while theeconomy of the Philippines expands, it fails to acquire the attributes of a developed economy.For instance, while the educated leave the country for mental labor, the others in theworkforce are at home, working in factories or doing very basic mental labor (Alburo andDanilo). This description of the economy of the Philippines reveals that unlike the economiesof developed countries where the majority of the workforce is involved in metal labor, theFilipino economy is still driven by physical labor. Since factual data suggest that a developedeconomy is unlikely physical-labor driven one, it can be deduced that the Filipino economywill see its growth halted by this factor in the coming future. In contrast, considering some of the economic benefits of brain drain on thePhilippines, the government should not act against it. By exporting workers to other countries,the unemployment rate in the Philippines decreases. It has been statistically proven that abouta total of nine million Filipinos work overseas, which is about 10% of the total population(Macaraig) and 23% of the workforce (Llorito). This means that the remaining 67% of the
  • 3. labor force in the Philippines can compete for jobs at home whereas the full 40 millionFilipino workforce would have to compete for the same number of jobs if it were not for thebrain drain. Moreover, the remittances sent back to the Philippines by the OFWs contributes ahuge sum to the nation’s gross domestic product (GDP). OFW dollar remittances haverecently averaged about US$7 billion per year (Llorito) and peaked at more than $11.6 billionin 2005 (Hennessey). The foreign remittances account for about 13% of the Filipino GDP(Llorito) and the specialized workers account for about 340,000, which is about 3.78% of theOFWs and about 0.85% of the Filipino workforce (Alburo and Danilo). These data show thathaving brain drain certainly helps out with the economic growth of the nation since only 0.85%of the 40 million labor force working in the foreign countries makes up roughly about 10% ofthe Philippines’ total GDP. In addition, brain drain solves the problem of providing jobs forboth the past and current generation workers. According to a study done by InternationalMigration Programme, many of the Filipino migrant workers were already in the labor forceand had come from the past decade’s professionals (Alburo and Danilo). This means that asthe previous generation’s professional workers move out of the country to work abroad, thenew professionals can find jobs at home more easily, hence effectively increasing theemployment rate. However, the brain drain is impeding the development of the Philippines. Thequestion to ponder is, “how to develop when the best and the brightest routinely set out insearch of [more developed and comfortable nations]?” (Hennessey) This questions how thePhilippines is supposed to develop if its brightest citizens, who can change the nation, moveout of the country. Also, the Philippines lacks incentives to offer to the brightest to keep themfrom leaving. With no solutions in sight, business groups and the government hold little hopeof keeping the nation’s top talent at home (Macaraig). This means that with the decreasingnumber of accessible skilled local workers, businesses and the government are hesitant to
  • 4. spend time and effort to improve the situation. Moreover, these employers in the Philippinesare hesitant as Myrna Asuncion, the assistant director of the Filipino government’s EconomicPlanning Department, puts it, “you cannot stop skilled professionals from seeking greenerpastures” (Macaraig). In addition, the skilled are enticed by the incentives they find outside oftheir homeland. Highly skilled physicians, teachers, seamen, engineers, nurses, and manyothers receive a high level of university training only to apply their knowledge and expertisein other countries (“Brain Drain in the Philippines,” 2009.). For instance, Paris Chuchana, acivil engineer, joined the migration in 2008 when he moved with his family to Singapore totake a job earning about $1,600 per month, which is six times the maximum salary he couldexpect in the Philippines (Macaraig). This implies that a large number of secondary to tertiarystudents do not even think about working in their home country because of the personalbenefits they see in working abroad. However, the social benefits of brain drain should not to be ignored. Brain drainsolves the dilemma of providing adequate jobs for the growing population in the Philippines.Some Filipino officials claim that due to the high birth rate in the Philippines, the brain drainis not really a problem. They argue that brain drain is actually positive as it brings inremittances. If the overseas workers were to try to find jobs in the Philippines, theunemployment rate would rise by 40% (“Brain Drain in the Philippines,” 2008.). This showsthat brain drain actually reduces the social burden that the Filipino government wouldotherwise face. Moreover, studies suggest that brain drain may even stimulate education ofthe remaining population in the Philippines. By allowing migration of the best and thebrightest from a developing country may actually increase the incentive to acquire educationand this would encourage the average level of education of the remaining population to rise(Hennessey). This is because the Filipinos in the Philippines will see the incentive ineducated OFWs and will wish to become one. Likewise, some studies even postulate that if
  • 5. OFWs were to return to the Philippines, they would make positive contributions to theircountry. In other countries, there are many cases already of overseas skilled workersreturning to their countries of origin and taking on public or private jobs that capitalize ontheir migration experience. Despite the loss at first, this reverse migration brings in the wealthand know-how of the previously skilled migrant workers (Alburo and Danilo). Consequently,some people predict that what happened elsewhere could happen in the Philippines as well. Yet, the social problems attributable to brain drain are still too great for brain drain toremain at its current level. Brain drain saps most of the brightest and skilled workers out ofthe country, leaving a skills deficit in positions of responsibility throughout the country.Vicente Leogardo, director-general of the Employers’ Confederation of the Philippinesdescribes the situation as “a skills hemorrhage” (Macaraig), because the proportion of OFWswith tertiary education is far greater than the proportion in terms of secondary education(Alburo and Danilo). 340,000 skilled professionals worldwide are about 36% of the nation’stotal skilled professionals (Alburo and Danilo). This means that without skilled workers, thesituation at home will not differ from the generation before. Furthermore, without skilledworkers at home, the social balance is broken. In 2008, the Labor Department of the Filipinogovernment found that while there was a large domestic workforce, many positions for“skilled workers went unfilled because of the lack of qualified applicants” (Macaraig). Agreat number of OFWs belong to the most productive age groups, which refers to the agesbetween 25 and 44 (Alburo and Danilo). This implies that the workers left in the Philippinesare mostly laborers or skilled professionals greater than age of 44 who are either decreasingin productivity or in a more unproductive state. Brain drain significantly affects health careand safety within the country. For example, Filipino medical professionals are migrating toother countries to fill the shortage of medical professionals in those countries (Hennessey).Francisco Duque, the Philippines health secretary, asserts that 85% of the country’s nurses
  • 6. have left the country to fill the greying population of West health professionals (“Brain Drainin the Philippines,” 2008.). Even 4,000 doctors left the country to become nurses in wealthiercountries for money and 4,000 more are currently studying to leave (Llorito). Anotherexample is in organizations such as the government weather forecast station, which lost 24qualified meteorologists who moved abroad for better-paying jobs. After this incident, thisorganization failed to predict the destructive Typhoon Conson that hit the Philippines. ThisTyphoon killed at least 22 people and caused power cut in more than half of the northernisland of Luzon for several days (“Asia Weathers: Typhoon Conson in the Philippines”).Another sector of the government, the environment department, reported to have lost 83geologists to overseas work in the most recent three years (2007-2010) (Macaraig). Withoutthese qualified and skilled workers to provide health care and safety, the Filipinos at homeare in constant fear. To sum up, if the Filipino government does not take any actions to counteract thebrain drain in its country, the Philippines will continue to enjoy the large remittances that addto its GDP and the decrease in the unemployment rate. However, these benefits areoutweighed by the problems that are caused by brain drain; thus, the net effect of brain drainon the Philippines is negative. The only way for the Filipino government to solve economicproblems, impediment in development, and social troubles caused by brain drain is to take amore aggressive stance against it.